82.13.020  <<  82.13.030 >>   82.13.040

Penalties.

*** CHANGE IN 2019 *** (SEE 5581-S.SL) ***
(1)(a) The department must assess a penalty against any seller, other than a referrer acting in its capacity as a referrer, that fails to provide notice to consumers pursuant to RCW 82.13.020(2)(a), in addition to any other applicable penalties, in the amount of twenty thousand dollars. The department may assess the penalty under this subsection only once per calendar year, regardless of the number of notices a seller fails to provide pursuant to RCW 82.13.020(2)(a) during the calendar year. The department may apply this penalty at any time during a calendar year and no more frequently than annually.
(b) The department must assess a penalty against any referrer that fails to provide notice to consumers pursuant to RCW 82.13.020(3), in addition to any other applicable penalties, in the amount of twenty thousand dollars. The department may apply this penalty at any time during a calendar year and no more frequently than annually.
(2)(a) The department must assess a penalty against a seller who fails to provide a report as required by RCW 82.13.020 (4) or (5), in addition to any other applicable penalties, as follows:
(i) Five thousand dollars if the gross receipts of the seller and through the seller's marketplace from retail sales sourced to this state under RCW 82.32.730 are less than fifty thousand dollars for the calendar year for which the report was required to be made;
(ii) Ten thousand dollars if the gross receipts of the seller and through the seller's marketplace from retail sales sourced to this state under RCW 82.32.730 are at least fifty thousand dollars but less than one hundred fifty thousand dollars;
(iii) Fifty thousand dollars if the gross receipts of the seller and through the seller's marketplace from retail sales sourced to this state under RCW 82.32.730 are at least one hundred fifty thousand dollars but less than three hundred thousand dollars; or
(iv) If the gross receipts of the seller and through the seller's marketplace from retail sales sourced to this state under RCW 82.32.730 are three hundred thousand dollars or greater, one hundred thousand dollars plus twenty thousand dollars for every fifty thousand dollars in gross receipts over three hundred thousand dollars.
(b) The department must assess a penalty against a referrer who fails to provide the notice and list required by RCW 82.13.020(5), in addition to any other applicable penalties. The department may assess the penalty under this subsection only once per calendar year, regardless of the number of failures to comply with RCW 82.13.020(5) during the calendar year. The amount of the penalties assessed are as follows:
(i) Fifty thousand dollars if the gross income of the referrer is at least two hundred sixty-seven thousand dollars but less than three hundred thousand dollars of the gross income of the business received from the referrer's referral services apportioned to Washington under RCW 82.04.460, whether or not subject to tax under chapter 82.04 RCW, for the calendar year for which the notice and list was required to be made; or
(ii) If the gross income of the referrer is three hundred thousand dollars or greater, one hundred thousand dollars plus twenty thousand dollars for every fifty thousand dollars in gross income over three hundred thousand dollars of the gross income of the business received from the referrer's referral services apportioned to Washington under RCW 82.04.460, whether or not subject to tax under chapter 82.04 RCW, for the calendar year for which the notice and list was required to be made.
(3) The department must assess a penalty against any seller, other than a referrer acting in its capacity as a referrer, who fails to provide a report to the department as required by RCW 82.13.020(6), in addition to any other applicable penalties, in the amount of twenty-five dollars multiplied by the number of consumers that should have been included on such report, but not less than twenty thousand dollars for any calendar year.
(4) The penalties imposed under subsections (1) through (3) of this section are cumulative.
(5) No penalty may be imposed by the department under subsections (1) through (4) of this section more than four years after the close of the calendar year in which the notice or report giving rise to the penalty was required to have been provided. This subsection (5) does not apply to penalties reassessed under subsection (9) of this section.
(6) When assessing a penalty under this section, the department may use any reasonable estimation technique where necessary or appropriate to determine the amount of any penalty.
(7) Interest accrues on the amount of the total penalty that has been assessed under this section until the total penalty amount is paid in full. Interest imposed under this section must be computed and assessed as provided in RCW 82.32.050 as if the penalty imposed under this subsection was a tax liability.
(8) The department must notify a seller by mail, or electronically as provided in RCW 82.32.135, of the amount of any penalty and interest due under this section. Amounts due under this section must be paid in full within thirty days from the date of the notice, or within such further time as the department may provide in its sole discretion.
(9)(a)(i) A seller is entitled to a conditional waiver of penalties and interest imposed under this section if the seller enters into a written agreement with the department electing to collect retail sales or use tax or fully comply with all applicable notice and reporting requirements of this chapter, beginning by a date acceptable to the department. An election to collect retail sales or use tax must be for a period of at least twelve consecutive months and is subject to the provisions of RCW 82.08.053(1)(d).
(ii) The department may grant a waiver of penalties and interest under this subsection (9)(a) for penalties and interest assessed for a seller's failure to comply with the notice and reporting requirements for one or more violations.
(iii) The department may not grant more than one request by a seller for a waiver of penalties and interest under this subsection (9)(a).
(iv) The department must reassess penalties and interest conditionally waived under this subsection (9)(a) if the department finds that, after the date that the seller agreed to fully comply with the applicable notice and reporting requirements of this chapter, the seller failed to:
(A) Provide notice under RCW 82.13.020(2)(a)(ii) to at least ninety percent of the consumers entitled to such notice in any given calendar year or portion of the initial calendar year in which the agreement required under this subsection was in effect if the agreement was in effect for less than the entire calendar year;
(B) Timely provide the reports required under RCW 82.13.020(4) to all consumers who received notice from the seller under RCW 82.13.020(2)(a)(ii) during any calendar year, unless the department finds that any such failure was due to circumstances beyond the seller's control;
(C) Timely provide the reports required under RCW 82.13.020(6) during any calendar year, unless the department finds that any such failure was due to circumstances beyond the seller's control; or
(D) With respect to referrers, timely provide the notice required under RCW 82.13.020(3) and the notice and list required under RCW 82.13.020(5) during any calendar year, unless the department finds that any such failure was due to circumstances beyond the referrer's control.
(v) The department must reassess penalties and interest conditionally waived under this subsection (9)(a) if the department finds that, after the date that the seller elected to collect retail sales or use tax, the seller failed to register with the department and make a reasonable effort to comply with the requirements of RCW 82.08.050 and 82.12.040.
(vi) The department may not reassess penalties and interest conditionally waived under this subsection (9)(a) more than four calendar years following the calendar year in which the department granted the conditional waiver under this subsection (9)(a).
(vii) The provisions of subsection (8) of this section apply to penalties and interest reassessed under this subsection (9)(a). The department may add additional interest on penalties reassessed under this subsection (9)(a) only if the total amount of penalties reassessed under this subsection (9)(a) is not paid in full by the date due.
(b) The department must waive penalties and interest imposed under this section if the department determines that the failure of the seller to fully comply with the notice or reporting requirements was due to circumstances beyond the seller's control.
(c) The department may waive penalties imposed under this section if the department determines that the failure of the seller to fully comply with the notice or reporting requirements was due to reasonable cause and not willful neglect. In determining whether reasonable cause exists, the department will consider, among other relevant factors, whether: (i) The failure was due to willful or reckless disregard of the seller's notice or reporting obligations; (ii) the seller made subsequent efforts to avoid future noncompliance; and (iii) the magnitude of the noncompliance was significant in terms of dollars and time when accounting for the seller's size and volume of transactions. On appeal, a court or the board of tax appeals must give great deference to the department's penalty waiver decision under this subsection (9)(c) and affirm the department's decision, unless the taxpayer can show by clear, cogent, and convincing evidence that the department's decision lacked any reasonable basis.
(d) A request for a waiver of penalties and interest under this subsection must be received by the department in writing and before the penalties and interest for which a waiver is requested are due pursuant to subsection (8) of this section. The department must deny any request for a waiver of penalties and interest that does not fully comply with the provisions of this subsection (9)(d).

NOTES:

FindingsIntent2017 3rd sp.s. c 28 §§ 201-214: See note following RCW 82.08.053.
Existing rights and liabilitySeverability2017 3rd sp.s. c 28: See notes following RCW 82.08.053.
ApplicationEffective dates2017 3rd sp.s. c 28: See notes following RCW 82.13.020.
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